September 7, 2004

For Immediate Release
Address: 26-1 Sakuragaoka-cho , Shibuya-ku, Tokyo
Company name: Global Media Online Inc.
Code No.9449
Company representative: Masatoshi Kumagai , Representative Director and President
Contact person: Masashi Yasuda , Executive Director
TEL: 03-5456-2555 (switchboard)
FAX: 03-3780-2611
URL: http://www.gmo.jp

Notice of Succession of Internet Service Businesses of Zero Inc. through Corporate Spin-Off
Global Media Online INC. (“GMO”) is pleased to announce that a meeting of the Board ofDirectors on September 7, 2004 approved a Spin-Off Agreement, following the conclusion of a basic
agreement on the succession of the Internet service businesses of Zero Inc., which GMO announced
on July 9, 2004. The date of the corporate spin-off has been set as November 1, 2004.

1. Purpose of Corporate Spin-Off
The GMO Group, of which GMO is the core member, is the only corporate group in Japan
capable of providing “one-stop” services needed for Internet business. These include an accessservice, a domain service, a rental server service, and an Internet advertising media service, allprovided under a strategic theme of “Becoming Japan’s Internet Division.”
For its access business, GMO acquired on April 1, 2004 the trade rights to the Internet connection
service and hosting service of Bekkoame Co., Ltd., a pioneer Internet provider for individual users in
the domestic market. Moreover, GMO began providing the “GMO everywhere LAN” service forsmall and midsize companies on May 20, 2004, as another means of enhancing its operations. This
service enables users to construct a virtual LAN system, a first for the industry.
Meanwhile, Zero provides Internet-related services based on its corporate philosophy of creating
new value and public benefits through the dissemination of the Internet. Zero started the “10 yenmail” service in 1997 as a precedent for the Internet email services and has built a foundation for thepresent mobile communications. Since then, it has been endeavoring to promote the Internet throughsuch measures as providing the Zero Internet connection service, nationwide at a low rate. This has
been welcomed by many Internet users, including beginners.
Zero now plans to merge with Skymark Airlines Co., Ltd., which operates an air transportation
business, on November 1, 2004. Skymark Airlines will be the surviving company. After the merger,

Zero will specialize in system development areas such as an electronic commerce settlement service,
to make full use of the technologies and management resources it cultivated in the Internet service
businesses in a bid to bolster its operations. To coincide with the merger, Zero has been examining
the possibility of transferring its Internet service businesses to another company, given expectations
that these businesses would be less related to its future line of business.
Under these circumstances, GMO will expand its operations by taking over the Internet service
business of Zero through a merger, following a shared expression of interest by both GMO and Zero.
After the merger, GMO will inherit the existing brands of Zero and will continue to provide itsInternet services.

2. Details of the Corporate Spin-Off(1) Schedule
Item

DateTheCompany

Splitcompany

Spin-Off Agreement approved at○○a Board meeting
September 7, 2004 (Tue.)Spin-Off Agreement signed○○
Spin-Off Agreement to beapproved at an extraordinary−※1※2
meeting of shareholders
Planned date of spin-offNovember 1, 2004 (Mon.)○○
Planned date of spin-off Early November 2004○○registration※１ The Company does not plan to receive approval at an extraordinary meeting of shareholders,pursuant to the provision in Article 374 – 23 of the Commercial Code.
※２The company implementing the spin-off (Zero) does not plan to receive the approval of an

extraordinary meeting of shareholders, pursuant to the provision of Article 374 – 22 of theCommercial Code.

(2) Method of Spin-Off
1. Type of spin-off
This is an absorption-type acquisition in which GMO’s stock will be issued to the company
implementing the spin-off, and GMO shall be the surviving company while Zero will be thecompany implementing the spin-off.

2. Reason for using this type of method
GMO has decided to use the absorption-type acquisition because it is more efficient and smoothercompared with a transfer of operations.

(3) Allocation of Shares
1. Share allocation ratio
GMO will issue and allocate 890,100 shares of its common stock to Zero.

2. Calculation result, calculation method and calculation basis by third-party institution
The share allocation ratio was decided by both interested parties based on the results of acalculation made by Attax Business Consulting Co., Ltd., the third-party institution.

3. New shares to be issued by the share split
Common stock

890,100 shares(4)Subsidy upon split
No subsidy shall be paid upon the split.

(5) Rights and obligations succeeded by GMO
The rights and obligations that GMO will inherit from Zero through the corporate spin-off shall be
all assets and liabilities and the status of other rights and obligations related to the Internet service
businesses, calculated by adding or subtracting the changes up to the date of the spin-off to theirrespective amounts based on the balance sheet and other calculations on March 31, 2004, unlessotherwise stated in the Spin-Off Agreement. The transfer of debts shall be a debt assumption without
recourse unless otherwise stated in the Spin-Off Agreement.
AssetsLiabilities

Current assets

134,628,000 yen

Current liabilities

85,292,000 yen

Fixed assets

56,852,000 yen

Fixed liabilities

9,050,000 yen

Total assets

191,481,000 yen

Total liabilities

94,342,000 yen(6) Prospect for redemption of debt
With respect to the amounts of assets and liabilities which GMO will inherit from Zero, theamount of assets is expected to exceed GMO will assume is presently recognized. Even after thespin-off, the debts that GMO will assume are expected to be redeemed on their redemption dates.

Zero Inc. (the year ended March 31, 2004)
Name
Zero Inc.
Before thesuccession

The Company
Zero Inc.

After thesuccession

The Company

The Company（the year ended December 31, 2003）
AssetsLiabilities
Net assets
4,943,686 thousand 179,407 thousand
4,764,278
yenyenthousand yen
11,803,920 thousand
1,841,749
9,962,170
yen
thousand yen
thousand yen
4,752,205 thousand
85,064 thousand
4,667,140
yen
yen
thousand yen
11,995,401 thousand
1,936,091
10,059,310
yen
thousand yen
thousand yen

３．Profile of Interested Parties(1)Company name
Global Media Online Inc.
(2)Type(s) of business
1. Access business
2. Rental server business3. Domain business4. Web site production business(3)Date of establishment
May 24, 1991
(4)Location of head office
Cerulean Tower, 26-1,
Sakuragaoka-cho, Shibuya-ku,Tokyo(5)Representative Director
Masatoshi Kumagai(6)Capital
3,311,130,000 yen(7)No. of shares issued
28,364,394 *(8)Shareholder capital
9,962,170,000 yen(Dec.2003)(9)Total assets
11,803,920,000 yen(Dec.2003)(10)End of fiscal year
December 31(11)No. of employees
173 (Dec.2003)(12)Major clients
Sales customers: general clients
et al.
(13)Major shareholders and Kumagai Masatoshi Office Ltd.
their investment ratio
41.2% (Dec.2003)(10% or more)(14)Main bank
Bank of Tokyo-Mitsubishi(15)Relationship ofcompanies involved

Capitalrelationship
Personnel
relationship
Businessrelationship

n/an/an/aZero Inc.
ManagementofInternet
related services and the saleof digital contents of music
and securities data
December 12, 1986
8-14-24,
Nishi-shinjuku,
Shinjuku-ku, Tokyo
Yoshio Fuwa
1,500,000,000 yen
47,4004,764,278,000 yen(Mar.2004)
4,943,686,000 yen(Mar.2004)
March 3125 (Mar.2004)
Sales customers: generalclients et al.
Shinichi Nishikubo 46.4％(Mar.2004)

Sumitomo Mitsui Banking
Corporation, The Sumitomo
Trust & Banking Co., Ltd.

(16)Performance Over Past 3 Fiscal Years (of Each Company)
Global Media Online Inc.
Zero Inc.
(Acquiring company)(Company Implementing Spin-Off)
2001 (“Dec.)
2002 (“Dec.)
2003 (“Dec.)
2002 (Mar.)
2003 (Mar.)
2004 (Mar.)
PeriodSales
6,925,122
6,648,037
7,238,375
3,750,947
2,252,282
1,605,790(thousand yen)
Operating profit
613,644479,859
854,621319,548
219,104
424,389(thousand yen)
( loss)Ordinary profit
568,095
461,644883,505
307,504
177,456
536,536(thousand yen)
( loss)Net profit
60,043
123,839
576,056
781,535
1,315,451
517,386(thousand yen)
( loss)Net Profit per
2.31
4.48
20.81
15,324.23
26,340.63
11,312.71
share (yen)( loss)Annual dividend
24
65,000−−per share (yen）Shareholder
307.96294.73360.06
115,535.03
92,815.86
104,665.72
capital per share(yen）* The total number of shares outstanding of the Company will increase 29,001,494 shares, to57,365,888 shares, from the end of the interim period on June 30, 2004 to September 7, 2004
through the stock split and stock swap.
4. Details of Businesses to Be Inherited(1) Content of Internet Service Business Division① Internet email service “10 yen mail”② Internet connection service “Zero”③ Delivery service of music data/securities data
(2) Business performance of the Internet Service Business Division in the year ended March 31,
2004
Results of theInternet Service
Company in the year
Ratio (a/b)
Business Division (a)ended December 31,
2003 (b)Sales (million yen)
1,576
7,238
21.77%
Operating profit
424
854
49.65%(million yen)
Ordinary profit
424
883
48.02%(million yen)

5. Status of GMO after the Succession
Situation of the Company after the stock swap is as follows.
(1)Company nameLocation of head office(2)Business activities
1. Access business
2. Rental server business3. Domain business(3)Location of head office Cerulean Tower, 26-1,
Sakuragaoka-cho, Shibuya-ku, Tokyo(4)Representative
Masatoshi Kumagai(5)Capital
3,311,130,000 yen. The capital will not change after the stock splitswap.
(6)Effect on business
The earnings forecast will not change with the stock split.
performanceEnd